Episode #117: 'Preparing Natural Gas Utilities for the Decarbonized Future' with Meena Beyers, Vice President of Business and Community Development, Nicor Gas [an Energy Central Power Perspectives™ Podcast]

Specifically, Nicor Gas is also working towards their own net zero goals by 2050, through tools like net zero methane, reducing operational emissions, leak detection, renewable gas pilots, and more. In this episode, the Energy Central Power Perspectives Podcast is joined by Meena Beyers, Nicor Gas's Vice President of Business and Community Development to highlight some of the unique pilot projects, including their Smart Neighborhoods program, that's changing the conversation around what a gas utility can do to be a key part of the clean energy future. Listen in as Meena shares with podcast host Jason Price and producer Matt Chester about the Nicor Gas net zero goals and the roadmap to meeting those targets.

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Thanks to the sponsor of this episode of the Energy Central Power Perspectives Podcast: West Monroe.  

Key Links

• Meena Beyers' Energy Central Profile: https://energycentral.com/member/profile/meena-beyers

• The Role of Gas Companies in a Net Zero Future: A Spotlight on Nicor Gas Smart Neighborhoods™: https://energycentral.com/c/pip/role-gas-companies-net-zero-future-spotlight-nicor-gas-smart-neighborhoods%E2%84%A2

• Did you know? The Energy Central Power Perspectives Podcast has been identified as one of the industry's 'Top 25 Energy Podcasts': https://blog.feedspot.com/energy_podcasts/

TRANSCRIPT

Jason Price: 

Welcome to the Energy Central Power Perspectives Podcast, the show that brings leading minds from the energy industry to discuss the challenges and trends that are transforming and modernizing our energy systems, and a quick thank you to West Monroe, our sponsor of today's show. Now, let's talk energy.

I'm Jason Price, Energy Central podcast host and director with West Monroe, coming to you from New York City and with me as always, from Orlando, Florida is Energy Central producer and community manager, Matt Chester. Matt, these days it seems more important than ever for utilities to be working towards net zero goals. Investors, policy makers, customers and boards and directors are calling for ambitious decarbonization targets. Can you give us a brief overview on the state of these goals across the US utility sector?

Matt Chester: 

I'd love to, Jason. So as of today, 24 states across the US, as well as the District of Columbia, all have some sort of greenhouse gas reduction targets as a part of their official policy, whether that came by legislation or executive order in those states, and they also come via different terms. Some are 100% carbon free electricity versus 100% renewable energy versus 100% clean energy versus net zero emissions versus even economy-wide carbon neutrality and even more. And, then these targets are also varying based on their dates with some expected by the 2030s, such as DC's 100% renewable energy by 2032 or New Jersey's 100% carbon-free electricity by 2035, while most of them are end up looking at the 2045 or 2050 as the end goal. Our guest today though is working in Illinois where the current law in the books calls for 100% clean energy by 2050 with interim targets of 40% by 2030 and 50% by 2040.

Jason Price: 

Great background, Matt. Thanks for sharing this, and of course, I ask because we're joined today by a representative from one such utility who is working to make a dent in net zero goals, and what makes us especially compelling is that she is from a natural gas utility, highlighting the role that Nonelectric utilities also have towards this clean energy future. Specifically, we're going to be joined today by Meena Beyers, the vice president of business and community development at Nicor Gas, and Meena is looking to share some successes and insight that Nicor Gas has learned from a recent pilot project implemented known as the Smart Neighborhood Project. Let's waste no more time and bring her in so we can learn from their top lessons as well. Meena, welcome today's episode of the Energy Central Power Perspectives Podcast.

Meena Beyers: 

Hey, Jason and Matt. Thanks so much for having me.

Jason Price: 

Meena, before we dig in to discuss on the topic of decarbonization of a natural gas utility, what can you tell us about Nicor Gas and your role as vice president of business and community development?

Meena Beyers: 

Sure, so as Matt mentioned, we're based here in Northern Illinois. Nicor Gas is the largest gas distribution company in Illinois in our parent company's, Southern Company's family of companies. So at Nicor, we serve 2.3 million customers in more than 650 communities across the northern part of Illinois, and as you're aware, this is the Midwest, it gets cold here. So, if you take customers' total gas and electric consumption in our service area, we deliver 75% of the energy that they use annually, so it's a pretty big load. In my role, I lead all things growth and community for the business, from community affairs and corporate philanthropy to customer solutions and energy efficiency, and I also get to lead a lot of our work in innovation, hydrogen exploration, emerging technologies, and our Smart Neighborhoods Project that we're going to talk about today.

Jason Price: 

Meena, you shared with us offline that you often have to educate people when it comes to decarbonization of a natural gas utility. So, walk us through your approach and what are some lessons learned from many gas utility executives who may be listening to the podcast today?

Meena Beyers: 

That's right, Jason. For example, in Illinois, there's so many times when we have the resources and the expertise and solutions to really help move the needle and help meet those state goals, but we don't always have the opportunity to share our voice or be part of the conversation because it's assumed that natural gas solutions can't be or won't be a part of the clean energy future. At Nicor, we have 34,000 miles of pipe that deliver natural gas in our state. We know that's a critical part of our state's energy portfolio, and we know that our energy portfolio in Illinois is what makes us globally competitive.

It's not just electric, but it's natural gas, electric, nuclear, solar, wind, soon to be hydrogen all working together, and we believe that these energy sources are actually better together. So, our approach at Nicor Gas and Southern Company is really to be solution oriented. We're doing the work to decarbonize across our value chain and work towards net zero, but we're also looking for opportunities to leverage this existing system that's serving customers and leverage our expertise and leverage our investments in technology to advance the state's clean energy goals and in some cases maybe even accelerate them.

Jason Price: 

That sounds great, so share with us, how are you working towards debunking the incompatibility of achieving net zero as a natural gas utility?

Meena Beyers: 

So, I mentioned our parent company is Southern Company and Southern Company is working towards net zero greenhouse gas emissions from enterprise-wide operations by 2050, and I think that's a target that there's a number of utilities starting to step and work towards that target. And at Nicor, we've set a consistent goal in support of Southern Company's goal to reach net zero greenhouse gas emissions from our operations by 2050 as well. We're also working on opportunities even beyond that, beyond our own operations to support emissions reductions from our supply chain and to empower customer emissions reductions. We know that's a big part of the discussion as well, and on the operations front, our infrastructure modernization has already helped us reduce our operational emissions by more than 50% since 2009. We're also doing some really exciting work in advanced leak detection technologies and using predictive analytics to prevent third party accidents.

So, it's really on our operation strategy. It's all the tools in the toolkit that we're putting to work. We've got two renewable gas pilots that I think is pretty novel for a gas utility. One is an interconnection tariff, another one is a carbon offset and R&G customer program, it's called TotalGreen and that launches this spring and additionally on customers for end use, everything starts with energy efficiency. We've got a really robust energy efficiency program here, but we're doing everything from advanced energy efficiency to I mentioned hydrogen exploration. We are exploring how we can include hydrogen for industrial decarbonization, and we're not only looking at emissions reductions, but just how this natural gas system and how natural gas supports resilience and affordability during economy-wide decarbonization. We know that there's going to be a lot more stress on the grid and there are ways that we can actually support the acceleration of decarbonization in different sectors by leveraging the system that we have.

Jason Price: 

And, there's a key case study on Nicor Gas working towards net zero and we already teased that out in the intro. This is called Smart Neighborhoods Program. Can you give us some context on what the program is generally and what types of projects have been previously implemented under that umbrella?

Meena Beyers: 

Yes, I am so excited to talk to you about Smart Neighborhood. Smart Neighborhood is actually a Southern Company initiative. It started with Alabama Power, who built a Smart Neighborhood that was a solar microgrid, and the next one was with Georgia Power that actually looked at battery storage as a resilience place. So, the whole idea behind Smart Neighborhoods is that the utility will partner with a developer to really test out as a living lab some specific technologies and learnings. When we set out to develop the Nicor Gas Smart Neighborhood we thought, what is it that we want to better understand as a natural gas utility, particularly in a cold climate region? And for us that was, how do we support and accelerate net zero buildings that are resilient and affordable. Our Smart Neighborhood is in Aurora, Illinois. It's a suburb of Chicago here, and it's being developed in partnership with Habitat for Humanity, and it's a 17 unit affordable housing community, the first of its kinds in Illinois.

We actually worked with the National Renewable Energy Lab to simulate the neighborhood through a year of actual weather and usage. So, we tested 20-plus technology combinations to see how the different technologies worked together and what was optimal for this goal of affordability and resilient net zero, and what we found is that the most affordable and most resilient path to net zero in our region is a home that includes electric, natural gas usage, and renewables. We modeled it with natural gas generators too for added resilience, but in the community that we're actually going to be building in Aurora with Habitat for Humanity, we're actually going to include backup battery storage instead. And, then we're integrating smart components like smart panels to make the integration of all those energy sources seamless and really easy for residents, and those residents will be selected by our local Habitat for Humanity chapter.

We just really believe really strongly that energy efficient housing and net zero housing for that matter should be affordable for everyone, not just people who can pay a premium for premium products. So for this development, net zero energy and carbon neutral, we're basing that on the total energy of the home, not just the natural gas. And, we're looking at the whole home because that's how customers look at it. So in this case, we have rooftop solar and energy efficiency offsetting usage and emissions. So we're pretty excited, as a part of the project, we'll have a demo home for several years that we can post tours and do trainings and really let members of the community come and touch and feel the equipment and learn about the technologies and how they work together.

Jason Price: 

That sounds great. Be sure to post the results on the Energy Central platform. I'm sure the community would love to see the results.

Meena Beyers: 

We would love to do that.

Jason Price: 

So, let's talk a bit further. So, how did you work with the regulators to have this approved since this was a pilot? I'm assuming that there's cost obviously components to this. Was this included in the rate case? Just talk us through that part of the approval process.

Meena Beyers: 

Well, this project was really different for a natural gas utility to undertake, and we actually first started working on this project with the National Renewable Energy Lab in October of 2019, and our first options to fund it were to either apply for a Department of Energy Connected Communities grants and/or to request recovery of some portion of it in a rate request as research and development. And of course over the next couple of years, neither of those came through.

The DOE only funded all electric projects in that round of the Connected Communities funding, and then we did not get the rate recovery of the project as R&D, although we were commended for the concept. So, a lot of times when I'm talking about this project, especially internally in the utility, I talk about it being a test of energy resilience, not just the system and the components in the project, but our own personal resilience to do something innovative because it took so much effort to make this project happen, but ultimately the business felt that this project was so important that it is shareholder funded, and it's our investment in demonstrating the importance of affordability, really focusing on limited income energy solutions and making sure that doesn't get lost in these efforts to accelerate the clean energy transition.

Jason Price: 

That's really interesting, and more importantly, it's interesting that Nicor Gas is leading this. You mentioned that your company worked with Habitat for Humanity and NREL for these ambitious goals. So, how do those collaborations come about and what has the process looked like thus far?

Meena Beyers: 

So, Nicor Gas is a longtime partner with Habitat for Humanity. In fact, they're among one of the top affordable housing developers in Illinois, so we do a lot of work with them. We actually started talking about this concept together when we first started talking to NREL about the Connected Communities concept. Habitat actually started those conversations with us and helped us shape what the project would look like. Listening to the community and really working together on what works and what doesn't has been such an important part of this process, especially when we're so focused on affordability. A great partner like Habitat has really helped us expand our understanding of what is truly affordable construction, how are different materials or equipment increasing or lowering the cost of constructing a home. We talk a lot about what this will be like for homeowners, not just the costs of operating and maintenance costs of the equipment, but even things like their comfort with sharing data with the utility.

So, all of those things are at the forefront of the discussion. So it's really been a wonderful collaboration, particularly with an organization like Habitat that they really do put their homeowners first and the community first, so that's been really great. We're also working really closely with the city where the development is being built or the city of Aurora. They've been incredibly supportive and a strong advocate for the project from the start, and they're really excited to be a part of this pilot project alongside Nicor because they are actually implementing their smart city initiative in a citywide fiber initiative, so it's all sort of working together really collaboratively.

Jason Price: 

That's great to hear. So, the Smart Neighborhood amounted to a pilot project, but on a large scale. So share with us, what are you hoping for some lessons learned and what have the results been like so far?

Meena Beyers: 

Really when we designed the learning objectives, and even just the way that we modeled this project, we wanted to focus on scalability, not just for us to see how we could help support net zero buildings in our service area and across Southern Company, but also for affordable housing for Habitat. They're building homes all over the country, and they're exploring how can we lower the cost but also make more sustainable homes. So, scalability was a huge part of our considerations when we designed the project, and we're actually working with the second Habitat for Humanity community in our service area, which will bring us to 30 units total, and the idea is to really understand this model, like you said, share the learnings.

We want to share the learnings to see how we can scale it and accelerate net zero buildings, but we're also going to, like I mentioned, get usage data and really understand the integration of the energy sources and behavioral components, really understand, how does the homeowner's awareness of the energy systems and their usage, the way that they use the energy in the home, how does that influence their actions? We're even kicking around some far out ideas like, could this whole community serve as a dispatchable resource for grid services? Those are the kinds of things that we want to explore with Habitat, with the homeowners association.

Jason Price: 

Like your very own VPP. So, what are some next steps in this process? So share with us, are these technologies poised to be installed more widely across the Nicor Gas service area? Anything you can elaborate on this would be great to hear.

Meena Beyers: 

So, there's so much to learn in this process. We're going to get this first community and really understand the data and work with the homeowners and this is pretty early on. Construction begins this summer, so we're hoping to have our first homes occupied as soon as the first half of next year, and that's really when we'll be able to start working with the homeowners and monitoring the data and the usage, but then also working with them on the educational and behavioral components. I think the really great thing about this model is that most of these technologies we're putting in are available today, like the insulated concrete forms and heat recovery ventilation. That's all technology that's available today, and we are testing some future phase technology in some different phases of the project, like hybrid heat pump solutions, where there isn't a ton of great data on that yet.

So, we're excited to be getting that, and also gas heat pumps, so newer technology. But as far as next steps, obviously building the community and getting the homeowners in there first, but once we're able to do that, collecting the data, learning from the people, not just from the data, but learning from the people and building on those learnings to really scale net zero homes and how we engage communities in that. And to do that, we'll continue these innovative partnerships with partners like Habitat and the City of Aurora and NREL to test different technologies and really learn how we can continue to be a part of the solution.

Jason Price: 

All right, fantastic, and Meena, the next question I've already shared with you ahead of time, because this is really for all the gas utilities listening to this conversation, so here it goes. Can you speak, big picture, to how the Smart Neighborhood implementation has fit into the puzzle of you showing how a gas company can in fact be part of meeting ambitious clean energy and net zero targets?

Meena Beyers: 

Yes, and I'm so glad that you asked this question because we talked about a few minutes ago across sectors, decarbonization is going to put incredible stress on the electric grid, particularly in places that are cold climate regions like us. And with this clean energy transition and the path to net zero, I think there are groups in the industry that have really made it all about emissions reductions at any cost, and what Smart Neighborhoods does is it refocuses the clean energy transition back onto customers, back onto people, and optimizing affordability and resilience with net zero, we're showing that that is possible. And, we've learned that natural gas with electric is the best path to that affordability and resiliency. So, hopefully this project will help demonstrate how, again, particularly in cold climate regions with significant heat load, how we can leverage existing, reliable, affordable natural gas infrastructure to support that clean energy transition.

Jason Price: 

Fantastic, so Meena, you've already provided us some great insight into ways that net zero can be met and the exciting work to come, but before we let you go and wrap up the episode, and we will give you the last word, we first want to pivot to what we call the lightning round, which gives us an opportunity which gives us an opportunity to learn more about you versus you the person rather than the professional. So, we ask a set of five questions and we ask you to keep your response to one word or phrase. So, are you ready?

Meena Beyers: 

Yes, let's go.

Jason Price: 

All right, so what book are you taking with you to a deserted island?

Meena Beyers: 

The Wind in the Willows.

Jason Price: 

For you, what's the most comforting of comfort foods?

Meena Beyers: 

Indian food, it's yellow dal and rice.

Jason Price: 

What's the first major splurge you'd make if you won the lottery?

Meena Beyers: 

I'd say ownership in a sports franchise, like a baseball team.

Jason Price: 

What would be an alternative career path if you hadn't found yourself in the energy industry?

Meena Beyers: 

Affordable housing policy.

Jason Price: 

What are you most motivated by?

Meena Beyers: 

Creative problem solving.

Jason Price: 

Nice job.

Meena Beyers: 

Thank you.

Jason Price: 

By succeeding in our lightning round, that means we grant you the last word of today's episode. So for those listening to our conversation, especially for all your peers in the gas utility space, what's the final and lasting message you hope they take away from this episode?

Meena Beyers: 

Great. Well, Jason, I was at an event last week and there was a leader talking about courageous optimism, and I've been thinking a lot about that phrase, and I think that's where collectively we need to be in our industry, and particularly among utilities today. Not winners and losers, not fear, but courageous optimism that by working together we can tackle these very complex challenges while prioritizing people and their livelihoods. So, I guess my lasting thought is natural gas utilities can be leveraged right now as a resource to help us meet these clean energy goals and achieve net zero and our Smart Neighborhoods Project is just one way that we're showing the energy industry that we're ready and willing to be a part of that solution.

Jason Price: 

Fantastic, so taking such an abstract topic and making it real with the pilot that you're running just makes the conversation so fascinating, and I'm sure the Energy Central community is going to appreciate this and look for lots of questions and comments once this podcast is posted on the site. And, be sure to be aware of questions coming in, Meena, you might have an audience of people that are going to be curious to want to learn more. So, thank you for joining this podcast today.

Meena Beyers: 

Thank you, Jason. Thanks so much for having me, and if the listeners want to learn more about Smart Neighborhoods, we have a website with more information. It's ngsmartneighborhoods.com.

Jason Price: 

Fantastic, and you can always reach Meena through the Energy Central platform where she welcomes your questions and comments, and we'll also give a shout out of thanks to the podcast sponsors that made today's episode possible. Thanks to West Monroe. West Monroe works with the nation's largest electric, gas, and water utilities, and their telecommunication, grid modernization, and digital, and workforce transformations. West Monroe brings a multidisciplinary team that blends utility, operations, and technology expertise to address modernizing aging infrastructure, advisory and transportation electrification, ADMS, deployments, data and analytics, and cybersecurity. And once again, I'm your host Jason Price. Plug in and stay fully charged in the discussion by hopping into the community at energcentral.com and we'll see you next time at the Energy Central Power Perspectives Podcast.

About Energy Central Podcasts

The ‘Energy Central Power Perspectives™ Podcast’ features conversations with thought leaders in the utility sector. At least twice monthly, we connect with an Energy Central Power Industry Network community member to discuss compelling topics that impact professionals who work in the power industry. Some podcasts may be a continuation of thought-provoking posts or discussions started in the community or with an industry leader that is interested in sharing their expertise and doing a deeper dive into hot topics or issues relevant to the industry.

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